US open: Stocks go green as US and China look to de-escalate trade tensions
Wall Street stocks opened higher on Tuesday following a rally during the previous session that was driven by comments made by Donald Trump while attending the G-7 meeting in France.
As of 1530 BST, the Dow Jones Industrial Average was up 0.37% at 25,995.75, while the S&P 500 was 0.42% firmer at 2,890.42 and the Nasdaq Composite started out the session 0.56% stronger at 7,897.81.
The Dow Jones opened 96.92 points stronger on Tuesday after closing higher during the previous session after Trump said at the G7 summit in France that the US and China were ready to start talking very seriously following contacts by phone between the two global superpowers a day earlier.
Sentiment got another boost on Tuesday after China revealed measures aimed at increasing consumption, including removing restrictions on buying US-made cars.
On Monday, the US President also said he expected the US to reach a trade deal with China, citing economic pressure on Beijing and China's vice-premier, Liu He, called for a resolution of the ongoing dispute.
SpreadEx analyst Connor Campbell said: "Reports of some trade war combatting Chinese stimulus – alongside the fumes of optimism that there is still appetite for a deal between Washington and Beijing – extended the market’s rebound on Tuesday.
"The Dow Jones was less gung-ho on Tuesday, adding around 0.3%. Still, that meant the index spent the early part of trading testing 26,000, a level it abandoned last Friday as the US and China engaged in a spiteful game of tariff tit-for-tat. Whether the Dow can cling onto that growth until the end of the session is another matter entirely – after all, this August has been defined by its unpredictability."
On the data front, orders for civilian and military aircraft and parts lifted US durable goods orders last month.
According to the Department of Commerce, orders for goods made to last more than three years jumped at a month-on-month pace of 2.1% in July to reach $250.38bn.
Elsewhere, US house price growth slowed in June, according to the S&P/Case-Shiller National Home Price Index out on Tuesday.
The 20-city index rose 2.1% year-on-year, down from 2.4% growth in May and missing expectations for a 2.4% increase.
In parallel, the Conference Board reported that its US consumer confidence index fell to a reading of 135.1 in August from a reading of 135.8 a month earlier. While still a decline, the figure was much higher than expected on the Street.
August's Richmond Fed manufacturing index was still to come.
In corporate news, tobacco companies Altria and Philip Morris International confirmed on Tuesday that they were in talks about a potential all-stock merger of equals. Altria surged 6.15% on the back of the news, while Philip Morris slumped 3.85%.
Ford and GM shares meanwhile accelerated following the news of the potential removal of sanctions on US-made vehicles in China.